LANSING, Mich. – The state Treasurer’s office kicked off a new program Monday aimed at pumping as much as $150 million of low-rate deposits into the state’s credit unions and banks.
Under the Michigan CD Stimulus Program, the state will deposit as much as $150 million into credit unions and banks by buying six- and 12-month CDs at below market rates of 2.25% and 2.50%, respectively. The minimum CD to be purchased by the state will be $100,000 and the maximum $10 million. The funds will be available over the next 60 days, until Feb. 6.
The state is shifting deposits from other investments to help the credit unions and banks, according to Caleb Buhs, a spokesman for the Treasurer’s office. "The money would have been invested anyway," he told The Credit Union Journal yesterday.
The funds are being deposited with the condition that up to 80% of the deposits go to making loans to Michigan businesses and consumers, said Buhs.
The program is similar to an initiative that has deposited $278 million into Illinois credit unions and banks so far.
